Müller Milk & Ingredients will proceed with plans to invest £60 million in restructuring its network of fresh milk and ingredients dairies in Britain, creating up to 180 jobs.
But the company has announced that operations at its dairy in Chadwell Heath, northeast London will be wound down over the next 15 months with the potential loss of 389 permanent posts.
The decision follows a review of the company’s dairy network designed to secure its future sustainability, competitiveness and enhance Müller’s capabilities to produce a greater range of fresh milk products.
FoodBev first reported on the plans in November, saying that the investment is part of a total of more than £100 million which will be spent by Müller in the UK across its Müller Milk & Ingredients and Müller Yogurt & Desserts businesses in the next 18 months.
The £60 million investment at Müller’s five separate processing facilities is designed to secure a sustainable and vibrant future for the business.
Key areas of investment include a new filling line at the Foston plant in Lincolnshire, enhancements to processing capabilities at Droitwich and Bridgwater, and the creation of a centre of excellence for flavoured milk and fresh cream at Severnside.
Müller has already announced a £15 million investment in its dairy at Bellshill to create a Scottish fresh milk and ingredients centre of excellence and reversed a decision taken by Dairy Crest, prior to the sale of its dairies to Müller, to close a dairy at Hanworth in southwest London.
Müller Milk & Ingredients managing director Andrew McInnes said: “We understand that the decision to wind down processing operations at Chadwell Heath directly affects a number of our colleagues, but unfortunately this announcement is unavoidable.
“It is clear that the dairy at Chadwell Heath is no longer economically viable and in an environment where there is simply too much fresh milk processing capacity, we simply cannot justify the level of investment required for the complete overhaul and modernisation required at the site.
“Wherever possible, we will offer colleagues opportunities to relocate within our network, and we will do everything we possibly can to support those who do not wish to relocate or for whom there are no roles.
“Our goal is to secure a sustainable and vibrant future for the dairy sector in Britain and this decision enables us to press on with our investment plans. By improving operational efficiencies and capabilities at various sites, we aim to transform the milk and ingredients sector, benefitting our customers, consumers, colleagues and farmers.”
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